FTS International is about 30% up at the last check today as this week it successfully won the consent of about 75 percent of its senior secured notes holders. The proportion of stakeholder is of 6.250% of the secured notes payable by 2022. The investors agreed upon the restructuring program planned by the company. The agreement also covers nearly 64 percent of company’s loans acquired against securities. Widespread restructuring will be done into the company to deliver services of advanced level to the customers. The program will also impact company’s balance sheet with financial flexibility of $437.3 million. Relationship with vendors, customers and suppliers will have no impact of the agreement.
In his comments, Chief Executive Officer Michael Doss shared the company’s efforts of reducing spending to have enough cash. He described the agreement with Noteholders as fuel to strengthen relations with customers as well as suppliers. Doss praised the efforts and thanked investors, staff, vendors and customers in coming to that agreement.
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The company is intending implementing the restructuring program in coming weeks. The program will also be implemented in its subsidiary companies. The company will start with submitting a prepackaged plan for voluntary cases under the U.S. Bankruptcy Code. Under the agreed upon terms, debt claim of $30.6 million by lenders and Secured notes holders will be exchanged with cash consideration. And they will also become owner of 90.1% of the restructured entity against their respective claims. Current equity owner of FTSI will get the 9.9% share in the company after restructuring.
The agreement also leveraged the company to utilize the current cash sources to settle chapter 11 cases and to perform normal course of business. It will be financially beneficial for all stakeholders. The consenting creditors will also be entitled to receive 3% of their secured claim in cash upon fulfilling some conditions. The company is also in plans of providing operations with working capital through a revolving exit facility.